Luxury shoppers get more sophisticated
Updated: 2013-11-05 00:24
By Wang Wen (China Daily)
Chinese luxury consumers are getting more sophisticated, as they increasingly look for unique products and expect professional services.
It's widely known that Chinese tourists are supporting the global luxury market, but the reasons behind the overseas trips of Chinese luxury consumers are changing.
"Finding unique items not available in their home country and buying products in the brands' birthplaces are the main motivations for Chinese luxury consumers who buy items overseas, not just the lower prices," said Shou Yu-ying, managing director and senior vice-president at Ruder Finn China, a public relations firm.
Chinese consumers are becoming increasingly knowledgeable about the different luxury categories, she said, and they're also seeking luxurious overseas shopping experiences.
"These things all reflect the fact that the market is maturing," Shou added.
Observers said that the Chinese luxury market entered a stable development stage two years ago.
About 92 percent of Chinese consumers were dissatisfied with the luxury brands' services at home, according to the 2014 China Luxury Forecast, which was released on Monday by Ruder Finn and Ipsos Group, the third-largest market research company in the world.
The report polled 1,800 luxury consumers from the Chinese mainland and Hong Kong.
Poor customer service and lack of knowledgeable staff in China were the main complaints, Shou said.
Some luxury brands' employees working in China are less skilled than their European counterparts, a problem that is especially seen in brands selling items such as watches, she said.
"Luxury consumption is flowing from China to overseas," Shou said.
The growth of luxury sales in China is estimated to be a mere 2.5 percent year-on-year in 2013, consulting firm Bain & Co said in a report released in October, while the growth in the United States will surpass that seen in China this year.
The increasing number of Chinese shoppers visiting Western cities in the US is one of the main factors driving the growth there, the Bain report said.
That effect is being felt in Europe as well.
"We did see a higher proportion of transactions from tourists in Europe, and that was particularly the Chinese tourist," Fay Dodds, vice-president of Burberry Group Plc, said recently at the company's trading update conference for the six months to the end of September.
In part reflecting more trips by Chinese luxury shoppers, sales in the rest of Asia also accelerated during the period, while European flagship markets saw a higher proportion of tourist transactions, the United Kingdom-based luxury brand said, although the Chinese mainland still delivered high single-digit comparable growth in the quarter from July to September.
Meanwhile, as they search for unique luxury items and brands, Chinese consumers are also showing a greater interest in online luxury retailers, with 36 percent of the respondents from the mainland saying that they prefer to shop for luxury goods online, up 22 percentage points year-on-year, said the 2014 China Luxury Forecast.
Chinese residents' consumption intentions for most luxury items, including watches, bags, jewelry and wine, will remain the same next year as in 2013, but they're willing to spend more on fashion items, the report added.
"Consumers from the mainland plan to spend 14,000 yuan ($2,290) on clothes on average every time they shop," said Simon Tye, executive director at Ipsos.
Plans to spend more on luxury clothes also reflect the consumers' growing sophistication, as accessories are entry-level items for luxury consumers, while fashion products are at a higher level, he added.